* Markets closed for holiday in much of Europe
* China imposes tariffs of up to 25 pct on 128 U.S. goods
* Specs raise net long position in COMEX gold -CFTC
* GRAPHIC-2018 asset returns: tmsnrt.rs/2jvdmXl
(Updates prices, headline; adds comment, second byline, NEW
YORK to dateline)
By Renita D. Young and Zandi Shabalala
NEW YORK/LONDON, April 2 (Reuters) - Gold prices rose more
than 1 percent on Monday as the U.S. dollar softened and China
raised tariffs on U.S. products, escalating global trade
tensions.
China imposed extra tariffs of up to 25 percent on 128 U.S.
products including frozen pork and wine in response to U.S.
duties on imports of aluminum and steel.
With many major European financial centers closed for Easter
Monday, spot gold added 1.4 percent at $1,342.46 per
ounce by 1:34 p.m. EDT (1734 GMT), earlier reaching a $1,342.97
session high. It recorded its third straight quarter of gains on
Friday.
U.S. gold futures for June delivery settled up
$19.60, or 1.5 percent, at $1,346.90 per ounce.
"Increased geopolitical tension highlighted by China and
their retaliation and where this could end up is supporting gold
today," said Jeff Klearman, portfolio manager at GraniteShares.
Gold is often used as a store of value during times of
financial or political uncertainty.
"Last week we saw GDP revised up 2.9 percent (versus
expected 2.7 percent) which can be another indicator that U.S.
and global growth is doing well. Combine that with a trade war
and you could have inflation concerns supporting gold," Klearman
added.
A weaker dollar generally boosts the price of gold. The U.S.
dollar index , eased against a basket of six other major
currencies.
"A sizeable net long position in gold is also helping prop
things up," said Joshua Graves, senior commodity strategist at
RJO Futures in Chicago.
Gold speculators raised their net long position by 50,996
contracts to 172,834 contracts in the week to March 27, U.S.
Commodity Futures Trading Commission data showed on Friday.
Gold fell 1.7 percent last week in its biggest such drop
since early December. But it climbed 1.7 percent in
January-March, posting its third straight quarterly gain.
"Look for gold to break above the $1,337 level for further
momentum. Support appears around the $1,325 area. It is
difficult not to be bullish in the current panorama," said Kitco
Metals' Global Trading Director, Peter Hug.
In other precious metals, spot silver climbed 2.1
percent to $16.66 per ounce.
Platinum rose 0.6 percent at $933.60 per ounce,
having fallen to its lowest since Dec. 29 in the previous
session.
"The global platinum market showed a substantial supply
surplus in 2017 and is also likely to remain oversupplied in
2018," said Commerzbank, adding there was therefore little
potential for platinum to recover.
Palladium lost 1.8 percent at $934.10 an ounce after
dropping to $928, its lowest since Oct. 10.
(Additional reporting by Swati Verma in Bengaluru; Editing by
John Stonestreet and Tom Brown)